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Amazon Lands Carrier as Cloud Computing Client

By Rich Smith – Feb 5, 2020 at 11:46AM

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Carrier will become an independent company in under six months.

One week after a strong earnings report sent (AMZN -3.01%) stock soaring -- but slowing growth at Amazon Web Services (AWS) was highlighted as a weak spot -- the e-commerce and cloud computing giant moved to clean up that small blemish.

This morning, Amazon announced that AWS has signed up United Technologies (RTX -1.70%) subsidiary Carrier as a cloud computing client. A "leader in heating, ventilating, air-conditioning, refrigeration, fire, security, and building automation technologies," Carrier will now make AWS its "preferred cloud provider," hosting as much as 70% of its computing functions on AWS servers.  

Icons representing laptops, desktops, and mobile devices linked to a white cloud

Image source: Getty Images.

Carrier characterized the move as a means of "reducing IT infrastructure costs" while also leveraging AWS's expertise in "data warehouse, analytics, and machine learning (ML) services to identify efficiencies in its manufacturing processes and supply chains." Carrier also expects to use AWS's Internet of Things services "to underpin a new line of intelligent, networked products and services for the home, workplace, and refrigerated logistics chain."

Carrier (along with fellow UTC division Otis Elevator) is in the midst of a year-long plan to separate from United Technologies, preparatory to that company merging its defense-related businesses with defense contracting giant Raytheon (RTN) sometime before the end of this year's first half. Carrier hopes to hit the ground running immediately after its spinoff, and to jump start its growth through a "digital transformation." As Bobby George, Carrier's Vice President and Chief Digital Officer explained: "Carrier's work with AWS is an integral part of our digital transformation, and AWS is the hyperscale platform on which we expect to turn connected product and ecosystem data into opportunities for segment growth, new market channels, and improved customer experiences."

John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Rich Smith has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Amazon. The Motley Fool has a disclosure policy.

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